Investor AB Refinances $1.9 Billion Moelnlycke Health Care Debt

Moelnlycke Health Care AB, the Swedish maker of wound-care products, refinanced about 1.4 billion euros ($1.9 billion) of loans with the backing of owner Investor AB. (INVEB)

Moelnlycke got the senior debt after Investor AB increased its equity in the company by 544 million euros, according to a statement from its owner. The funds included 225 million euros relating to Moelnlycke’s mezzanine debt and the remainder is “new cash”.

Moelnlycke raised about 2 billion euros of leveraged loans in 2007, the first portions of which were due to mature next year, according to data compiled by Bloomberg. Investor AB said in April it planned to refinance Moelnlycke this year and targeted an investment-grade rating for the business.

Including the refinancing, the wound-care firm’s net debt would have been 814 million euros at the end of June, according to today’s statement. Its leverage, the ratio of net debt to earnings before interest, taxes, depreciation and amortization ratio, would be 2.5 times.

Moelnlycke’s net debt was 1.36 billion euros at the end of June and its Ebitda for the previous 12 months was 330 million euros, Investor AB said in a July report. Investor AB, the Wallenberg family’s publicly traded holding company, owned about 2 billion Swedish kronor ($309 million) of Moelnlycke’s mezzanine debt and 98 percent of its shares, it said at the time.

Investor AB and Morgan Stanley acquired Moelnlycke from Apax Partners LLP in 2007 in a deal valuing the business at about 2.9 billion euros. In 2010 Investor paid 510 million euros to buy a 34 percent stake owned by Morgan Stanley.

To contact the reporters on this story: Stephen Morris in London at smorris39@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net.

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